How Buying a House Actually Works | First-Time Buyer Experience

The title gives my big news away, but I briefly mentioned it in one of my highlights post that I had started viewing houses and that I was planning on buying a house. I’m glad to say that I have finally managed to complete the entire process and have bought my first ever home.

It is incredibly exciting and slightly daunting as you become responsible for anything that goes wrong in the house, instead of calling up a landlord to take care of it. But my dream has finally come true, and I feel so incredibly lucky and grateful I’ve been able to do this.

However, as a first-time buyer, I really had NO idea what the entire process consisted of and how it all worked, so of course I dived into reading various posts on the internet that explained the process to prepare me for it all. However, no matter how many websites I read, or podcasts I listened to, there was never any that broke down the process step by step.

So I decided to write my own post of things that weren’t exactly mentioned in any of those posts I read, and that are actually really useful to be aware of when buying a home for the first time.

VIEWING HOUSES

Ok, so you’ve started looking at houses – congratulations! It’s a fun process, but one that can be stressful at the same time, as there’ll be many that won’t quite hit the spot.

Make sure you have a list of things you want to find in a house written down, and take it with you on viewings. Ask the Estate Agent questions, but never seem too keen! Keep your cards close to your chest and once you have found the house you want to make an offer on, make the offer when you leave the viewing.

MORTGAGE IN PRINCIPLE

A lot of estate agencies want you to have an MIP in place when viewing houses, so they know you mean business. However, more often than not, you won’t need one until the point of making an offer.

If you have found a Mortgage Broker, they will provide you with the MIP before your viewings. Be aware that the MIP usually lasts for 30 days.

Tip: You can still make an offer if MIP is expired, however, you will need an updated one when submitting evidence after offer gets accepted.

Make sure when finding a Mortgage Advisor to also shop around and talk to more than one! Get different opinions and get the best rate that works for you. Also find out their fees; some charge a lot more than others, whilst some also charge at different stages of the process.

Personally, my Mortgage Advisors were amazing and would recommend them in an instant. They charged £350 at Completion which is a great deal. Make sure you pick one that charges at Completion, as you don’t want to lose money if things don’t work out.

MAKING AN OFFER

Depending on the EA (Estate Agent) that is linked to the property, they will have their own protocol of how to submit an offer. Annoyingly, my EA was with Purplebricks, so everything had to go through the App or online.

However, traditionally, you will need to call the EA expressing your interest in the property and making the offer that way. Writing an email is also strongly advised as this will confirm the offer and create an email chain.

First offer always gets rejected, so make sure you’re happy with the counter offer that will get proposed and are happy to accept.

ACCEPTED OFFER

Once the offer gets accepted, the EA will reach out to confirm this and start asking you to submit evidence.

One of the first things that happens when submitting evidence is you will have to pay for anti-money laundering checks. This checks your identity and it usually costs around £60.

You then have to submit proof of funds of your deposit. This will include bank statements up to 3/6 months depending on requirements, as well as an updated version of your MIP.

Once you have submitted everything, allow for a a day or two to hear back. If you don’t hear anything, then you will need to chase your EA. Especially, if you are dealing with Purplebricks, as they did not update me on the further evidence I had to submit, and only found this out when I called them.

Evidence I submitted were: updated MIP, 3-month bank statements, copy of passport and solicitor details.

GETTING A SOLICITOR

You will also need to provide contact details of the solicitors you have conducted to proceed with. This doesn’t take too long to choose, so I did this once my offer had been accepted, but got quotes beforehand.

Definitely get quotes from different solicitors, as they too charge differently and also make sure to check Trustpilot for their reviews.

Once you have chosen who to go with, you will need to tell them you will wish to instruct them to proceed and will pass on their details to the EA. You will need their email address and number.

MEMORANDUM OF SALE

Once you have submitted all the evidence required, the documents will get reviewed by the EA’s conveyancing team. They are the ones who look at the all evidence and flag if they require anything else. So it’s worth noting their direct line if you need to chase for updates, as the EA at this stage is not dealing with things.

One thing that was not mentioned in the articles I read, was the in-between process of getting your offer accepted and then instructing solicitors to begin the process. In order for your solicitors to begin, they will need the Memorandum of Sale which will be provided by the conveyancing team once they have approved the evidence submitted.

Getting the Memorandum was a bit of a wait, and I personally had to chase the conveyancing team for an update quite often, as they never seemed to reach out to me first. However, the wait to get the Memorandum of Sale can be anytime between 24 hours to 5 days. It really varies, I waited just over 48 hours for mine.

Once you have received the Memorandum of sale, you will need to let your solicitors and Mortgage Advisors know. A copy of the Memorandum will be sent to your solicitors via the conveyancing team, but it’s always good to let them know yourself so you are always in the loop.

This is when your solicitors will begin the process in the background.

MORTGAGE APPLICATION SUBMITTED

A copy of the Memorandum of Sale also needs to be given to your Mortgage Brokers as, although not legally binding, the Memorandum acts as provisional sale of the property.

Once they have this, they will then submit your mortgage application on your behalf. This is super easy and did not require any additional information from your behalf, as your mortgage brokers would already have all the details required from when they first sent you your MIP.

Evidence I submitted to my Advisors were: proof of funds in bank statements, employment details and 3-month worth of payslips, as well as, proof of identity.

SALES PROGRESSOR THROUGH EA

You will be assigned a Sales Progressor EA once you reach this stage of the process, at least with Purplebricks there was a different team that acted as the middle man between your solicitors and the Seller’s solicitors. So the EA that may have shown you the property will not necessarily be your point of contact from this stage.

They will reach out to both solicitor for updates, but will occasionally also ask you for an update, especially if your mortgage application has been approved.

TRANSFER SEARCH FUNDS TO SOLICITORS

This is something I wasn’t told about again in anything I read. Although solicitors mention that they only charge fees on Completion, you will have to transfer part of the funds (which will then be deducted from final quote) to cover the searches they will carry out for you.

My quote was around £1900, which is standard for a good mortgage solicitor, so I paid £350 to cover these search costs which was then deducted from my final Completion statement.

Solictors will also ask for proof of funds and carry out their own identity and money laundry checks again.

MORTGAGE EVALUATION

After your mortgage application has been submitted, you may have to wait a few days without hearing anything. However, eventually you will be told by your advisors that the lender will need to carry out an evaluation of the property to determine whether they should lend you out the money or not.

They survey is very basic so you should still plan to carry out your own survey out later.

A lot of the posts I read said to carry out your own survey as soon as offer gets accepted; however, my Mortgage Advisor advised to wait until mortgage offer has been granted in order to do it, so I wouldn’t have to fork out on a lot of money in the instance that the mortgage wouldn’t be issued. So I think this was a very good piece of advice to wait until that has happened, to then book your own one.

MORTGAGE OFFER ISSUED

It takes 2-3 days after the lender’s evaluation has taken place, to hear back if your mortgage has been granted and offer issued.

Your Mortgage Advisor will send a copy out to you by post as well as via email to read through once this has been granted, as well as a copy sent to your solicitors.

You can let the Sales Progressor know that the you have been issued a mortgage offer.

Once you have received your mortgage offer, read through it carefully and ask as many questions as needed so it all becomes clear to you.

Mortgage offer lasts for 6 months from this point, which should be enough time to take you into Completion.

TITLE DEED FORM & PROPERTY INFORMATION FORM RECEIVED

This is when the process can really start to take its time. However, after a few days your solicitors will email you the above documents to you. Also known as the TA6 form, or a TA7 form if you’re buying a leasehold property. It will include answers and comments from the Seller about the property mentioning things such as boundary lines, warranties, any works carried out on the property, reported complaints etc.

The Property Information Form will also come with a Contents Form, also known as TA10 form, which will highlight the items the Seller would be taking or keeping at the property when they move out.

The Title Deed Form is a copy of the Land Registry title of the property, marking it out on the map of its exact boundary and Freehold to you (should you be buying a Freehold).

Read these documents carefully and flag any questions or additional information you want to your solicitors so they can query back to the Seller solicitors.

CARRY OUT A SURVEY

Now is the time to carry out a building survey of the property to find out if there are any major issues with the property and whether that is still something you want to proceed with.

The type of survey depends on the property you are purchasing. As I was buying a terraced Victorian house, I went for a Level 3 Survey which cost £575. This sum of money really explains why you will want to wait until your mortgage offer has been issued before carrying out the survey.

If there are any major issues which you want to address, you can negotiate on the price after this time.

Note: Your solicitors will also need a copy of the survey as there will be things addressed to them on there that are legal things they will take care of. However, also note, if you intend to negotiate on the price, you will have to deal with your EA and not with your solicitors.

RATE CHANGES

The slow process continues, as solicitors work in the background raising queries and getting information together for Title documents.

If during this times, you’re lucky enough to have had your interest rates go down, then your Mortgage Advisor will secure the lowest rate for you on your behalf and let you know of the change. Before confirming the lower rate, they will reach out to ask if you’re close to Exchanging as the rate change can sometimes take a couple of days.

If things are taking too long, or you want an update on how things are going, then don’t hesitate to check in with your solicitors. The Sales Progressor will also check in from time to time to ask if you’re close to Exchange.

REPORT ON TITLE

After a few long weeks, once solicitors have gathered all necessary information and you are nearing the time to Exchange, you will receive the Report on Title which includes copies of all the searches and enquiries raised between yours and Seller solictors. It will also include information about the Seller.

Once you have raised any questions, you will need to sign all the documents your solicitors would have marked out needing your attention, and send back to them by post. FYI you will need to Witness sign some of these documents.

BUILDING & CONTENTS INSURANCE

Necessary as part of some lender terms, your Mortgage Advisors will find the best Building & Contents Insurance to cover this. However, it is also best to compare the market yourself and check if you’re getting a good deal or if the terms work for you.

You will need to set this up from date of Exchange, so your Mortgage Advisors need to know as soon as Exchange has taken place, so the insurance is activated and you are covered from that point on.

TRANSFER OF DEPOSIT

After you’ve signed and sent back the documents from the Report on Title, you will now need to transfer the deposit to solicitors who will hold the money until Completion.

As part of the Report on Title you will receive a Draft Completion Statement which includes the deposit you have agreed to transfer along with the fees you will be charged by your solicitors. You can send total balance in one lump sum, even the solicitor fees, as they will hold the money in the bank until Completion.

SETTLE ON DATE OF COMPLETION

If your solicitors have confirmed they’ve received the funds, they will now ask you to choose a date of when you would like to Complete.

This will be a bit of painful of a process, at least in my experience as I was in a chain, because I had to wait until the top of the chain could agree on the date proposed.

Note: Lender usually needs 6 working days to clear funds, so your Completion date needs to take that into consideration.

Settling on a Completion date can vary, but it can usually take any time from 1-4 weeks. In my case, it was in 4 weeks time.

EXCHANGE CONTRACTS

Despite having agreed Completion date weeks in advance, all members in the chain need to be ready for Exchange at the same time. So even though my solicitors were ready, the seller’s solicitors, for example, were not. Their solicitors still had to review documents one final time which took a few days, and still had to confirm on their chain if they were ready for Exchange as well.

All in all, Exchange happened a week before Completion Day. My solicitors had to call me so I could give verbal authorisation to exchange contracts. Once this was all confirmed along the chain, they called me back to let me know Exchange had taken place.

I then confirmed Exchange with my Mortgage Advisors so the insurance was in place from that day and I was being protected.

COMPLETION DAY

On date of Completion, funds need to be cleared by the bank within the entire chain before you could receive the keys.

In my case, it was around 11am when my solicitors called me to say that Completion has happened and I could now collect keys from the EA. I was lucky to have had the call quite early on in the day, as I read some people can expect to collect keys anything between 10am – 4pm.

Once you have the keys then it’s time to breathe and celebrate.

You will need to inspect the property to check if all rubbish had been cleared and if all things that were mentioned in the Contents Form were removed or left behind as stated.

You will also need to take a reading of your gas and electricity and perhaps even water.

If all things are in order, then it’s time to move in or start your renovation plans at your leisure. The property is officially yours.

REGISTRATION OF CHANGE AT LAND REGISTRY

Once all payments have been made to solicitors, they will now deal with registration of this change at the Land Registry. Registration formalities usually take about twelve weeks to complete, and they will let you know once complete.

They will also send a copy of the title deeds to your mortgage lender, who will hold them until you pay your mortgage off.

And that my friends, is how buying a house actually works – at least in my case. I hope you can find this helpful.

Do let me know in the comments your experience when buying!

xo